Loans. A statement of the sums which have been applied to the purchase of the Public Debt. Since that date, there has been applied to the same purpose, through the agency of And through Jonathan Burrall, in New York Total amount in specie TREASURY DEPARTMENT, January 16, 1793. G. $967,821 65 15,098 11 50,000 00 1,032,919 76 A statement showing the probable surplus of the revenue of the United States, for the year 1792. Nett product of duties on imports and tonnage, from the 1st of January to the 31st of December, 1792, as estimated (a) Nett products of duties on home-made spirits, as estimated $3,900,000 00 400,000 00 4,300,000 00 $2,849,194 73 APPROPRIATIONS. Interest on the Public Debt for the year 1792 For the support of Government for the same year, appropriated by Towards carrying into execution the act, entitled "An act making 600,000 00 523,500 00 Surplus 50,000 00 4,022,694 73 277,305 27 (a) This sum is estimated by adding to the ascertained product of the year 1791, an ascertained excess of product of the first two quarters of the year 1792, beyond the product of the first two quarters of the year 1791, being $252,319 11, and the estimated product for a half year, of the additional duties on imports, laid during the last session of Congress, and commencing on the 1st of July last, being $261,750. According to the information hitherto received at the Treasury, there is every probability that the amount of the duties for the last half year of 1792, will fully equal this calculation of their product, if in the ratio of the first half year, will exceed it. TREASURY DEPARTMENT, January 16, 1793. ALEXANDER HAMILTON. [Communicated to the House of Representatives, bruary 4, 1783.] LOANS. Fe-in France, pursuant to the act for that purpose; specifying the dates of the respective drafts upon the Commissioners in Holland, and the dates of the respective payments of the Debt: A similar statement is requested respecting the Debts to Spain and Holland. IN THE HOUSE OF REPRESENTATIVES U. S. Wednesday, January 23, 1793. Resolved, That the President of the United States be requested to cause to be laid before this House copies of the authorities under which Loans have been negotiated, pursuant to the acts of the 4th and 12th of August, 1790, together with copies of the authorities directing the application of the moneys borrowed. Resolved, That the President of the United States be requested to cause this House to be furnished with the names of the persons by whom and to whom the respective payments of the French Debt have been made Resolved, That the Secretary of the Treasury be directed to lay before this House an account, exhibiting, half-monthly, the balances between the United States and the Bank of the United States, including the several Branch Banks, from the commencement of those institutions to the end of the year 1792. Resolved, That the Secretary of the Treasury de directed to lay before this House an account of all moneys which may have come into the Sinking Fund, from the commencement of that institution to the present Loans. time; specifying the particular fund from which they have accrued, and exhibiting, half-yearly, the sums uninvested, and where deposited. Resolved, That the Secretary of the Treasury be directed to report to this House the balance of all unapplied revenues at the end of the year 1792; specifying whether in money or bonds, and noting where the money is deposited: That he also make report of all unapplied moneys which may have been obtained by the several Loans authorized by law, and where such moneys are now deposited. -- Here, however, I have to regret the utter impossibility of a strict compliance with the terms of the resolution. The practicability of such a compliance would suppose nothing less than that, since the last day of December, 1792, all the accounts of all the Collectors of the Customs, and other officers of the revenue throughout the whole extent of the United States, could be digested, made up, and forwarded to the Treasury-could be examined there, settled, and carried into the public books under their proper heads. In a word, that all the accounts of the revenues, receipts, and passed through a complete exhibition, examination, and adjustment within the short period of twenty-three days. It was made (as I presume from the result) satisfactorily to appear to a Committee of the House of Representatives, who were charged during the last session with framing a direction to the Treasury for bringing forward an annual account of Receipts and Expenditures, that the course of public business would not admit of the rendering of such an account in less than nine months after the expiration of each year; in conformity to which idea, their report was formed and an order of the House established. Report of the SECRETARY of the TREASURY, in pursu- expenditures of this extensive country, could have ance of the foregoing resolutions: TREASURY DEPARTMENT, Feb. 4, 1793. SIR: I have lost no time in preparing, as far as has been practicable, consistently with the course of facts, the several statements required by the resolutions of the House of Representatives of the 23d of last month; and I have concluded to add to them such further statements as appeared to me necessary to convey fully the information which is understood to be the object of those resolutions. It was my first intention to submit these statements collectively, with such explanatory remarks as the occasion might demand; but finding on experiment. from the extent and variety of the matter involved in the resolutions, that more time will be requisite for a full development of it than I had anticipated. considerations of weight in my mind have determined me to present the different parts of the subject successively. Among other advantages incident to this course of proceeding, will be that of having it in my power to give a more accurate and mature view of the entire subject, without too great a dereliction of the current business of the Department. In executing the task I propose to myself, I shall rely on the indulgence of the House to a latitude of observation, corresponding with the peculiar circumstances of the case. The resolutions to which I am to answer, were not moved without a pretty copious display of the reasons on which they were founded. These reasons are before the public, through the channel of the press. They are of a nature to excite attention, to beget alarm, to inspire doubts. Deductions of a very extraordinary complexion may, without forcing the sense, be drawn from them. I need do nothing more, to evince the impracticability of an exact compliance with the resolution in question, than to observe, that it is even more comprehensive (though with less detail) than the order of the House to which I have alluded. To evince, nevertheless, my readiness to do all in my power towards fulfilling the views of the House, and throwing light upon the transactions of the Department, I shall now offer to their inspection sundry statements, marked A, A B,* B, C, D, E, F, which contain, as far as is at this time possible, the information desired, and with sufficient certainty and accuracy to afford satisfaction on the points of inquiry involved in the resolution. The statement A shows in abstract the whole of the receipts into, and expenditures from, the Treasury, commencing with the first of January, and ending with the last of December, 1792, corresponding with the accounts of the Treasurer. These accounts have been regularly settled up to the end of September, and copies have been laid before the two Houses of Congress. The account for the quarter terminating with the year has not under examination, and will, no doubt, be settled as it stands-the manner of conducting the business, and the usual care and accuracy of the officer concerned, leaving very little room to apprehend misstatement or error. A copy of this account is herewith submitted in the schedule marked C. I feel it incumbent upon me to meet the sug-yet passed through the forms of settlement, but is gestions which have been thrown out with decision and explicitness. And while I hope I shall let fall nothing inconsistent with that cordial and unqualified respect which I feel for the House of Representatives, while I acquiesce in the sufficiency of the motives that induced on their part the giving a prompt and free course to the investigation proposed, I cannot but resolve to treat the subject with a freedom which is due to truth and to the consciousness of a pure zeal for the public interest. I begin with the last of the four resolutions, because it is that which seeks information relating to the most delicate and important of the suggestions that have been hazarded. This statement takes up the balance of the general account of Receipts and Expenditures to the end of the year 1791, as reported to the House of Representatives within the first week of the present session, and continuing it down to the end of 1792, shows a balance then in the Treasury of $783,444 51. *For this statement, see ante page 1191. Loans. on spirits distilled within the Total The statement B is a more comprehensive docu-VII. Uncollected residue of duties ment. It is a general account of Income and Expenditure. It shows not merely the actual receipts of money into the Treasury, but the whole amount of the national revenues from the commencement of the present Government to the conclusion of the year 1792, as well outstanding as collected-the proceeds of Domestic Loans-the whole amount of the sums which have been drawn into the United States on account of the Foreign Loans-and all other moneys, from whatever source, which have accrued within the period embraced by the statement. These items form the debit side of the account, amounting to $17,879,825 33. The credit side consists of two items. First, the whole amount of the actual expenditures to the end of the year 1791, as stated in the general account of Receipts and Expenditures before referred to. Second, the whole amount of the actual expenditures during the year 1792, as specified generally in the statement A, and particularly in the several quarterly accounts of the Treasurer, amounting to $12,765,128 83. 341,057 19 $5,116,897 00 It This aggregate somewhat exceeds the balance of the account; but, in a case where estimates must necessarily supply the deficiency of ascertained results, differences of this nature are of course. is, at the same time, satisfactory to observe that the estimates which have been heretofore communicated are proved, by the official documents already received, to have been essentially correct. It will no doubt readily occur to the House that a very small part of the excess, which has been stated, is a real surplus of income. There remain to be satisfied numerous objects of expenditure charged upon the fund by the appropriations which have been made, that cannot fail ultimately to exhaust it, probably within four or five hundred thousand dollars; which will be embraced in the appropriations for the service of the year 1793. A furThe balance of this account of Income and Ex-ther explanation on this point is reserved for penditure is, consequently, $5,114,696 50; which future communication. corresponds with the excess of the public income (including the proceeds of Loans foreign and domestic) beyond the actual expenditure, or, more properly speaking, disbursement to the end of If there was before any obscurity on the subject, the year 1792. This of course is exclusive of those parts of the proceeds of Foreign Loans which it was certainly not the fault of this Department. have been left in Europe to be applied there; the Till the last resolutions, no call has been made amount, application, and balance of which are ex-upon it which rendered it proper to exhibit a genhibited, as far as they are known at the Treasury, in the statement No. 1 of my late Report on Foreign Loans. This balance, as noted in the statement B, composed of the following particulars: I. Cash in the Treasury, per statement A II. Cash in the Bank of the United States, and the offices of Discount and Deposite of New York and Baltimore, not yet passed to the account of the Treasurer, per statement A B, III. Proceeds of Amsterdam bills remaining in deposite in the Bank of North America, including the sum of $156,595 56 cents advanced by the Bank without interest, which is credited in the general account of Receipts and Expenditures, statement A IV. Proceeds of Amsterdam bills sold but not yet received is A due comprehension of the statements now presented, must obviate every idea of a balance unaccounted for, in whatever sense the allegation may have been intended to be made. eral view of the public moneys and funds, or to show the amount and situation of such as were unapplied. Particular calls for particular objects were made, which as I conceive were complied with; but they were not comprehensive enough to embrace a disclosure of that nature. It could not, therefore, with propriety have been alleged $783,444 51 that there was a balance unaccounted for. To infer it from documents, which contained only a part of the necessary information, was not justifiable, nor could it otherwise happen than that conclusions wholly erroneous would be the consequences of taking such imperfect data for guides. 605,883 08 177,998 80 614,593 02 V. Cash in hands of Collectors of VI. Bonds unpaid at the end of the 2,442,069 15 It may be of use, by way of elucidation, to point out some of the most palpable features of the error which has been entertained. The following items are stated as the basis of the supposed deficiency: Residue of the proceeds of the Foreign bills sup- Surplus of revenue of the year 1792, 400,000 277,385 - $2,345,575 Deduct in Bank, meaning I presume the balance of the Treasurer's cash account Balance unaccounted for Loans. the amount of bills drawn at the Treasury upon the Foreign Fund. A disagreement no doubt 790,642 exists, and to the extent of 5,760,138 florins or guilders. $1,554,933 It appears in the first place to have been overlooked, that in statement No. 3, of my late Report concerning Foreign Loans, mention is made that, on the 3d of January, there remained to be received of the proceeds of the Foreign bills $632,132 02; consequently that sum could not be considered as in the Treasury, and ought to be deducted from the supposed deficiency. Among the official papers which it is intimated were consulted, was an original account, rendered by the Bank of the United States, of the sales of Amsterdam bills, showing a sum of $605,883 08, as having been received by the Bank and two of its offices of Discount and Deposite, for the proceeds of those bills. Had the document been understood, it would have been known that this sum was in Bank, over and above the balance of the Treasurer's cash account; and this, also, would have served to account for a large part of the supposed deficiency, namely, $605,883 08. The course of this transaction will be hereafter explained. But the following circumstances contain the solution of this disquieting appearance. There will be found in the statement A two several credits, each for $2,000,000, as for moneys received into the Treasury, with corresponding debits of equal sums as for moneys paid out of the Treasury. But neither the one nor the other did in reality take place. The whole is a mere operation to accomplish the purposes of the eleventh section of the "Act to incorporate the subscribers to the Bank of the United States," without an inconvenient and unnecessary displacement of funds. That section authorizes a subscription to the stock of the Bank, on account of the Government, not exceeding in amount $2,000,000, and provides for the payment of it out of the moneys which should be borrowed by virtue of either of the acts of the 4th and 12th of August, 1790-the first making provision for the Public Debt, the last for reducing it; enjoining, at the same time, that a Loan should be made of the Bank to an equal amount, to replace the moneys which were to be applied to the payment of the subscription. But among the misconceptions which have ob- It is evident that nothing could have been more tained, what relates to the surplus of revenue of useless (at the same time that it would have been the year 1792 is not the least striking. The laws attended with obvious disadvantages to the Goinform (and consequently no information on that vernment) than actually to draw from Europe, point from this Department could have been ne- out of the moneys borrowed there, the sum necescessary) that credits are allowed upon the duties sary for the payment of the subscription to the on imports of four, six, nine, twelve months, and Bank, and again to remit out of the Loan which in some cases of two years. Reason dictates, that was to be obtained of the Bank a sufficient sum to a surplus in such case must be considered as post- replace such moneys, or such part of them as may poned in the collection or receipt till all the ap-have been destined for the Foreign object. Loss propriations upon the fund have been first satisfied. The account of Receipts and Expenditures to the end of 1791, in possession of the House, shows that at that time no less a sum than $1,828,289 28 of the antecedent duties were outstanding in bonds. How, then, could it have happened that the surplus of 1792 was sought for in the Treasury at the very instant of the expiration of the year? I forbear to attempt to trace the source of a mistake so extraordinary. Let me, however, add that of the surplus in question, $172,584 82, are not payable till April and May, 1794, as will be seen by the abstract E. Thus have I not only furnished a just and affirmative view of the real situation of the public account, but have likewise shown, I trust in a conspicuous manner, fallacies enough in the statement, from which the inference of an unaccounted for balance is drawn, to evince that it is one tissue of error. In this I might have gone still further, there being scarcely a step of the whole process which is not liable to the imputation of misapprehension. But I wish not unnecessarily to weary the patience of the House. upon exchange in consequence of overstocking of the market with bills-loss in interest by the delays incident to the operation, and which would necessarily have suspended the useful employment of the funds for a considerable time-these are some of the disadvantages to the Government. To the Bank alone could any benefit have accrued, which would have been in proportion to the delay in restoring or applying the fund to its primitive destination. Such an operation, therefore, could only have been justified by an indisposition on the part of the Bank to facilitate the principal object, without the intervention of actual payment. But no such disposition existed. On this, as on every other occasion, a temper liberal towards the Government has characterized the conduct of the directors of that institution. It was accordingly proposed by me, and agreed to by them, that the object to be accomplished should be carried into effect by a merely formal arrangement. In this, however, it was necessary to consult the injunctions of law, and the principles of the constitution of the Treasury Depart ment. Another circumstance to which importance has These points, then, were to be effected-a paybeen given, and which was noticed in connexion ment of the subscription money, to vest the Gowith the suggestion last discussed, is a disagree-vernment with the property of the stock; possesment between a memorandum in the Treasurer's sion of the means of paying it, which were to be Bank Book and the statement reported by me, of derived from the Foreign Fund, and of course Loans. were first to be in the Treasury before payment could be made; the replacing what should be taken from that fund by a Loan of the Bank. The following plan for these purposes was devised and executed by previous concert: The Treasurer drew bills upon our Commissioners in Amsterdam for the sums requisite to complete the payment on account of the subscription. These bills were purchased by the Bank, and warrants in favor of the Treasurer upon the Bank served to place the proceeds in the Treasury. Warrants afterwards issued upon the Treasurer, in favor of the Bank, for the amount of the subscription money, which was receipted for on the part of the Bank as paid. Other warrants then issued in favor of the Treasurer upon the Bank, for equal sums, as upon account of a Loan to the Government; which warrants were satisfied by a re-delivery to the Treasurer of the bills that had been drawn upon the Commissioners. In the last place, warrants were drawn upon the Treasurer to replace the moneys, supposed by the arrange ment to be drawn from the Foreign fund, which perfected the operation. But, from the detail which has been given, it will be seen that in fact no moneys were either withdrawn from or returned to that fund. The bills were cancelled, annexed to the warrants, and are lodged in the Treasury as vouchers of the transaction. These bills were for two separate sums, each 2,475,000 guilders, equal to $1,000,000; the payment having been divided into two parts, upon certain equitable considerations, relative to the dividend of the first half year. This transaction explains 4,950,000 guilders, of the sum which forms the disagreement between the memorandum in the Treasurer's Bank Book and the statement reported by me. The residue is thus explained. The sum of 1,237,500 guilders, directed to be drawn for on the 30th of November, was directed to be comprised in one or more bills, as the Bank should desire. It was at first placed in one bill; but this bill was A. afterward returned, with a request that it might be converted into smaller sums. The bill returned was cancelled, and in lieu of it there had been furnished, prior to the first of January of the present year, 934,500 guilders-the balance, 303,000, then remaining to be furnished. The sum of 934,500 guilders consequently appears twice in the memorandum. These two sums of 4,590,000 and 934,500 guilders, exceed the difference in question by 124,362 guilders. The Treasurer informs me that there are two bills not included in the memorandum; one for 123,750, and the other for 612 guilders, which make up the above mentioned excess. The former of these two bills was furnished to the Secretary of State for the purpose contemplated by the 3d section of the act of the last session, entitled "An act making certain appropriations therein specified.” Is it not truly matter of regret, that so formal an explanation on such a point should have been made requisite? Could no personal inquiry of either of the officers concerned have superseded the necessity of publicly calling the attention of the House of Representatives to an appearance, in truth, so little significant? Was it seriously supposable that there could be any real difficulty in explaining that appearance, when the very disclosure of it proceeded from a voluntary act of the Head of this Department? With perfect respect, I have the honor to be, sir, your most obedient and most humble servant, ALEXANDER HAMILTON, Secretary of the Treasury. The Hon. the SPEAKER of the House of Representatives. [P. S. Another statement of Income and Expenditure having been made, which presents the subject under another aspect, but agreeing in the result with the statement B, is also herewith submitted, marked Ba.] General account of Receipts and Expenditures of Public Moneys, commencing the 1st of January, 1792, and ending the 31st of December, 1792. 1792. September DR. 30 To the amount of expenditures from the 1st of January to the *In the quarter ending the 30th of September, 1792 2,972,759 81 December 31 To the amount of expenditures from the 1st of October to the 1,250,592 61 Balance remaining in the hands of the Treasurer 783,444 51 $9,751,136 56 |